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TMI Blog2009 (9) TMI 897X X X X Extracts X X X X X X X X Extracts X X X X ..... espondent No. 4 unauthorizedly with interest at the rate of 21 per cent p.a. from September 22, 1997 till payment. The other prayer clause is to declare that the phrase "unless the goods so purchased are resold" excludes the Special Import Licence defined in entry 36 in Schedule C, Part I of the said Act in force during the period September 1, 1992 to September 30, 1995 and in the alternative for a declaration that section 13AA of the Bombay Sales Tax Act, 1959 as void and unconstitutional. The petitioners who are manufacturers of gold and diamond ornaments as a 100 per cent EOU, having the factory in free trade zone (SEEPZ), purchased in the open market what is known as a Special Import Licence. Sales tax was payable on the said SIL. The respondents' case is that as the Special Import Licences were not resold additional purchase tax is leviable under section 13AA. The petitioners contend that against SIL, goods were imported in the year 1994-95 in Bombay and were sold at Bombay. In the year 1995-96 the SIL were transferred to Delhi, and the goods were imported in Delhi and sold there and taxes have been paid under the Delhi Sales Tax Act. Before proceeding to answer the issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the commencement of the said Act." The validity of this provision was questioned before this court. By judgment and order dated August 28, 1990 in Writ Petition No. 477 of 1990(1) and another petitions, the petitions were allowed. Against which the appeals were preferred before the Supreme Court. For the reasons given in the judgment the learned court was pleased to allow the appeal by holding that the Bombay Sales Tax (Amendment) Act, 1990 (which replaced Maharashtra Ordinance 9 of 1989) was valid and by a competent Legislature. The court further observed in the light of the discussion in the judgment, the decision in Goodyear [1990] 76 STC 71 (SC) in so far as it declared the original section 13AA as invalid, must be deemed not to be the correct law. It is no doubt true that the amended provisions was not considered. However, as section 13AA as it stood, was held to be constitutionally valid, the challenge to the amended section on similar grounds must be rejected. This judgment was pronounced on April 8, 1994. Therefore, in our opinion, the challenge in so far as constitutional validity of section 13AA will have to be rejected. We will have to consider the other praye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udes growing crops, grass, and trees and plants (including the produce thereof) and all other things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale. Part I of Schedule C, entry No. 26 reads as under: Goods of incorporeal or intangible character, that is to say (a) Patents, (b) Trade marks (c) Import licences." The submission on behalf of the petitioner is that special import licence is not import licence and consequently it would not be covered by the aforesaid entry. We are concerned with the periods from April 1, 1994 to March 31, 1995 and April 1, 1995 to March 21, 1996. Before proceeding to answer the issue we may first gainfully refer to the judgments of the Supreme Court in Vikas Sales Corporation v. Commissioner of Commercial Taxes [1996] 102 STC 106. The Supreme Court there was considering import licence called replenishment licence (REP licences) or exim scrips under the provisions of the Tamil Nadu General Sales Tax Act, 1959, Karnataka Sales Tax Act, 1957 and the Kerala General Sales Tax Act, 1963. While considering the nature of these licences, the court noted that the Central Government has been i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t noted the General Clauses Act, 1987 defines "movable properties" to mean "property of every description except immovable property". The expression "immovable property" is defined to "include land, benefits to arise out of land and things attached to the earth or permanently fastened to anything attached to the earth". We have already referred to the definition of "goods" under the Bombay Sales Tax Act, 1959. After considering the various dictionary meanings as to what would constitute property, the court observed as under (at page 119 of 102 STC): "The above provisions do establish that REP licences have their own value. They are bought and sold as such. The original licensee or the purchaser is not bound to import the goods permissible thereunder. He can simply sell it to another and that another to yet another person. In other words, these licences/exim scrips have an inherent value of their own and are traded as such. They are treated and dealt with in the commercial world as merchandise, as goods. An REP licence/exim scrip is neither a chose-in-action nor an actionable claim. It is also not in the nature of a title deed. It has a value of its own. It is by itself a property ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ); [2006] 5 SCC 603 and secondly whether Vikas Sales Corporation [1996] 102 STC 106 (SC) would also apply to sale of DEPB. The court also considered the definition of "actionable claims" under section 3 of the Transfer of Properties Act which is defined as under: "'Actionable claims' means a claim to any debt, other than a debt secured by mortgage of immovable property or by hypothecation or pledge of movable property, or to any beneficial interest in movable property not in the possession, either actual or constructive, of the claimant, which the civil courts recognize as affording grounds for relief, whether such debt or beneficial interest be existent, accruing, conditional or contingent." After considering the nature of lottery ticket, the court went on to observe that on producing the ticket, one merely gets conditional interest in the prize money which was not in the purchaser's possession and would therefore fall squarely within the definition of "actionable claim". The court then hold that they were unable to see how the decision in Sunrise [2006] 145 STC 576 (SC); [2006] 5 SCC 603 can be said to alter the position in regard to the sale of REP licence as held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e they have imported goods. Therefore, considering the tests laid down by the Supreme Court for REP/DEPB licence as goods, will have to be applied and considered. It will have to be held that the SIL licences are also goods and consequently liable to sales tax. Once SIL is subjected to sales tax, then by virtue of section 13AA it will be liable to purchase tax. There is yet another reason. To Explanation II to entry 26, Part I of Schedule C by Mah. Act 21 of 1998, it was explained that for the purpose of the entry, import licence shall include special import licence. By virtue of the Explanation, the doubt if any has been removed an Explanation may be added. Ex abundanti cautela to allay groundless apprehension. See Abdul Latif Khan v. Mt. Abadi Begum AIR 1934 PC 188, Keshavji Ravji and Co. v. Commissioner of Income-tax [1990] 183 ITR 1 (SC); AIR 1991 SC 1806. It is also added sometimes to explain the meaning of the words contained in the section. From this it would be clear that SIL would fall under entry 26 of Schedule C, Part I. In the instant case, there is no dispute that the petitioners have used the SIL for importing goods. There is no dispute that the licences were ..... X X X X Extracts X X X X X X X X Extracts X X X X
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